How to Start a Business in Dubai

Starting a business in Dubai can be a lucrative endeavor, given its vibrant economy and strategic location as a global business hub.

However, learning how to open a business in Dubai takes dedication and diligence, as navigating the regulatory landscape and understanding the necessary procedures can be complex. This guide provides a comprehensive overview of the essential steps and requirements for setting up a business in Dubai.

Opening a business in Dubai: What You need to get started

Initial Approval from DED

The first step in starting a business in Dubai is to obtain initial approval from the Department of Economic Development (DED). This approval permits entrepreneurs to conduct commercial activities for up to six months. Applicants must submit the required documents and pay the associated fees.

Name Approval

Choosing a trade name is crucial, as it represents the identity of the business. Entrepreneurs must apply for name approval, which involves booking the desired name and obtaining approval from relevant authorities. Fees for name approval vary based on the chosen name and type of registration.

Office Rental for LLC

Local companies in Dubai are required to have a physical office space, which allows authorities to monitor business activities and ensure compliance with regulations. Entrepreneurs must rent office space for a minimum period, typically one year or more.

Office Rental and Resident Visas

According to local rules, the number of resident visas that an employer has the right to provide to its employees depends on the area of the office and its type. An area of 9 square meters entitles you to one visa (this is called Physical space). Renting an office of the Flexi desk type will allow you to get three permits to stay in the country. More than three visas can be obtained if the office space is of the type of Serviced office, but its area also matters (the larger it is, the more permits).

Office Rentals – Required Documents

Strict requirements are imposed on rented premises. It is forbidden to use them for other purposes, for example, an office for a warehouse or vice versa; you cannot live in the same place where you work. All this is strictly controlled. Required documentation includes:

• Proof of business ownership.
• Permission to use real estate.
• Compliance of the premises with the plans for its use.

If the tenant plans to rebuild the interior spaces, including the organization of partitions to create individual workplaces, this should be stated before signing the contract and an appropriate clause should be included in it. The contract should also include information about the terms of the lease, the physical address of the premises, and the date of signing the contract.

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Confirmation of the Founding Agreement of LLC

Paperwork for the founding agreement is another key consideration when processing a new company setup in Dubai. Partners or shareholders of a limited liability company (LLC) must confirm the founding agreement, outlining the company’s structure and operations. This confirmation involves a one-time payment, which varies based on the authorized capital.

Drafting an LLC Agreement in Arabic and English

LLC agreements must be drafted in both Arabic and English to ensure mutual understanding among shareholders. This legal document governs the rights and responsibilities of each party and requires registration and payment of associated fees.

Tax of the Ministry of Economic Development

The Ministry of Economy in each Emirate levies a one-time fee for registering an LLC. Additionally, annual fees may apply, depending on the business activities and jurisdiction.

Trade Permit for Local Companies

Obtaining a trade license is essential for conducting commercial activities in Dubai. The cost of a trade permit varies based on the type of business activity and may require additional deposits or insurance.

Commercial License (Ejari)

A commercial license, also known as Ejari, grants businesses the right to engage in commercial activities. Entrepreneurs must renew their commercial licenses annually.

Contribution to the Chamber of Commerce

Businesses are required to contribute a certain amount to the Chamber of Commerce annually. The contribution amount depends on the scale and nature of the business.

Fees for Improving Commercial Services

An annual fee is charged for improving commercial services provided by government agencies. This fee contributes to the enhancement of business operations and regulatory services.

Now that you’re familiar with the necessary steps to initiate your business in Dubai, it’s time to act. Start your search for commercial real estate with us and capitalize on our professional expertise. Contact our team to get started.